STRONG PROTEST

Gisborne Herald, Volume LXVI, Issue 20096, 16 November 1939, Page 4

STRONG PROTEST

POLITICAL CONTROL

THE RESERVE BANK CONFIDENCE NEEDED MONETARY MANAGEMENT (Per Press Association.) WELLINGTON, this day. Control of the Reserve Bank was discussed yesterday by the conference of the Associated Chambers of Commerce of New Zealand, which urged the necessity of increasing confidence in monetary management and financial measures which the present situation required. A Dunedin remit asked the conference to express an opinion that the monetary system of the country must be restored to a sound basis and that to this end (a) the war should be waged as far as possible out of national income and (b) the Reserve Bank must have restored to it its proper function. Several speakers thought clause (a) was dangerous, and it was eliminated, whereupon the Dunedin delegation withdrew the rest of the remit. Political Control Mr. R. V. White. Canterbury, moved the following remit: “That whereas politically-directed control of the Reserve Bank during the last few years has been a potent factor in bringing the country’s finances into an unsound position, this conference enters a most emphatic protest at the recent amendments to the Reserve Bank Act which subject the bank to direct political control, and urgently represents to the Government that the board of directors of the bank be brought to full strength by the appointment of qualified men of sound experience and that full opportunity be given to such board to carry out the functions of the bank as defined in the original Act, free from political interference, thereby increasing the confidence in monetary management and financial measures which the necessities of the present national situation require.”

“The remit is first of all a condemnation of the present state of the Reserve Bank,” Mr. White said. “The present situation is so serious and the need for reform so urgent tliat it seems this demand should be made with all possible emphasis. If we must have a Reserve Bank, which some of us doubt, it must be controlled by men who will have regard always to financial safety rather than to political expediency.” The remit was carried.